Economics 30200b. Price Theory IIb.

Course description. The second half of the course begins with expected utility theory, and then introduces the fundamental ideas of game theory: strategic-form games, Nash equilibrium, games with incomplete information, extensive-form games, sequential equilibrium, and repeated games. 
Winter 2009: (Tue, Thurs 1:30-2:50pm), second five weeks.
Instructor: Roger Myerson.

Main Texts:
A. Mas-Colell, M. Whinston, J. Green, Microeconomic Theory, Oxford U Press (1995), chapters 6, 7, 8, 9, M.M.
G. Jehle, P. Reny, Advanced Microeconomic Theory 2nd ed, Addison-Wesley (2001), section 2.4, chapter 7.
R. Myerson, Game Theory, Harvard U Press (1991), chapters 1-4,7.
Ec 302 Notes (these will develop further during the course).

Topics:
1. Utility theory, domination, duality: MWG sectn 6B; JR pp 92-104; My sectns 1.1-1.5,1.8-1.9; Notes pp 1-4.
2. Strategic-form games, domination, Nash equilibrium: MWG 7D,8B-8D; JR pp 267-280; My 3.1-3.5; Notes pp 5-7.
3. Incomplete-information games: MWG 8E; JR pp 280-285; My 2.8-2.9,3.9-3.11; Notes pp 8-11.
4. Extensive games and sequential equilibrium: MWG 7C,9A-C,12AA; JR pp 285-321; My 2.1-2.2,4.1-4.7,7.1,7.4; Notes pp 12-15.

Other readings:
R. Myerson, "Nash Equilibrium and the History of Economic Theory," J Economic Literature 37:1067-1082 (1999).
T. Schelling, Strategy of Conflict (1960) [ch 3 is J Conflict Resolution 1:19-36 (1957); see also my "Learning from Schelling"].

URL of this course page: http://home.uchicago.edu/~rmyerson/econ302b.htm